Factors Affecting Website Costs

Since I wrote about how much a web site costs, I’ve had lots of questions about the subject. One of the most common is, “Why do prices vary so much?”

I really understand this. When prices of an item are as variable as the costs for building a website, it’s hard to feel confident about what you’re paying. So I’d like to discuss some of the major factors that affect the price of a website.

Domain registration

The domain name of your site is the web address, or URL, of your website, such as YourBusiness.com. I’ve written before about choosing your domain name. Domain registration is a necessary cost, but it can vary.

Registering a domain is cheap: about $10 a year. Some hosting companies do it for free if you use their services. One young woman who has been asking questions chose to go with a .tk domain, since she could get that for free, but these domains are strongly associated with spam and shady sites, so this isn’t a good business move.

Others choose to use a free site without getting a domain name, but this has a danger: when you succeed in your business and want to upgrade your site, you’ll have to get a new URL, and will lose all the ground you’ve gained in search results and faithful customers.

There are places that will charge you more than $10 a year for domain registration. If they’re going to do some research and assist you in choosing the most effective URL for your business, it can be worth it. If not, then don’t pay more. The main thing to remember is that it’s a first-come first-served system, and there’s no benefit to waiting around. Just go ahead and register that domain name.

Hosting

This is the fee that you pay monthly or annually for the space you occupy on the web. It can range from nothing at all to hundreds per month for managed hosting. There is a wide variety of mass market companies, and you probably also have local options.

In my recent conversations, I’ve found that people can get very exercised about the question of hosting. Often this excitement focuses on getting the most bandwidth for the lowest price. I’ve worked with lots of clients who had lots of different hosting arrangements, and I’d say that trustworthiness and good service are, in real life, much more often the issue than the amount of bandwidth. I’ve also found that sites with free and cheap hosting don’t actually perform as well as those with professional hosting. They get hacked more often and they have more downtime. Often, too, there are multiple fees and add-ons which add up to as much as professional hosting before you finish.

Here’s the thing: if you aren’t prepared to pay for your business’s website, then you’re not in business.

Your website, whether you’re an online or a brick and mortar business, is the first thing most of your customers will see, and the main way they’ll know you. Some longtime business owners haven’t caught on to this yet, and some brand-new businesspeople don’t think this will be true for their businesses, but it’s a fact of modern life.

So if you’re thinking that you’ll go with free hosting in spite of the disadvantages, or you’re putting hours into comparing the specs on $6.95 a month hosting with $9.95 a month hosting, then it may be time for some serious thought about your business plans. It seems to me that many of the people who contact me for advice on getting a free website for their businesses are planning to fail, and hoping to put as little investment as possible into their businesses so they won’t lose much when they do so.

My personal feeling is that free hosting makes sense if you’re not in business. Your average $5 a month plan offers you no real advantages over free hosting, so why pay? However, I have heard some cogent arguments on the other side from people who plan to pay a small amount for their hobby sites. Fine. If you’re in business, though, you should budget for professional hosting.

Design

To this point, we’ve been talking about differences of a few dollars up front or a few hundred dollars over the course of a year. When we get to the design and building of a site, we’re getting into the real differences.

Here are some things to think about:

• Overhead can affect the cost. A web firm which has to pay salaries and light bills is going to have to charge you more than a student working on the kitchen table. A web firm is also likely to have access to specialized software and people with varied skill sets who can do the particular task required for your particular needs. If the bargain rate is based on low overhead, then it may not reflect poor quality work. If you don’t need the benefits of the firm, choosing a freelancer instead can offer real savings. Make sure that you know exactly what the low-overhead choice is planning to do. Will they code your site as well as designing it? Will they provide the content? Will they upload the files with your host? Will they make changes in the future if you need that done? There are a lot of steps in building a web site, and unless you go with a full-service firm, those steps probably will not all be included in the price you’re quoted.
• Time can affect the cost. One of the more astonishing bids sent to me in the course of the conversations I’ve been having came from a designer who charges slightly less per hour than I do. This designer did both content and design, though not coding, and helpfully gave time estimates in the cost breakdown. My client was concerned that we might be overlooking something. I sat for a while trying to imagine how writing — not building — a contact form could take five hours. Eventually, I just had to admit that I didn’t know why that designer was planning to take so much longer than we were. Since web design is generally done on an hourly basis, an efficient worker can save you a lot. Someone who does it badly and has to go back and do it over — or be replaced by someone else who does it over — can cost far more, though, so check out the portfolio.
• Hourly rate can affect the cost. I’ve worked with some excellent designers who charge relatively low rates because, for example, they’re students or they live in an inexpensive country. But you have to realize that right now business is very good for people in my line of work. Everyone who is actually good at writing or designing websites has plenty of work and is being paid well. There is no motivation for us to discount, and basic economics is going to tell you that this tends to mean that prices are rising, not falling. Before you choose someone with a low rate, make sure you know why their rate is low.

Even given this information, there may not be any very obvious reason for a price difference between two firms or between two freelancers. Look at their work and check their references, and choose someone you trust who also fits your budget.

Copywriting

You can write your own web content, and many businesses do. It’s usually a mistake. Writing for the web is a specialized skill, just as web design is. It’s not the same as writing an email to your friends, or a print ad, or even a sales letter. And your content has the largest effect on your success with search and conversions of any decision listed in this post. “Content,” as we all know, “is king.”

Copywriting is also never the expensive part of a website. Writing your own website is simply false economy.

If you’re working with a web design firm which expects you to provide the content, hire professional web content writers like us at Haden Interactive to produce your content.

SEO

As a general rule, your website is not going to be visible just because you launch it. You have to draw it to the attention of the search engines. This involves both onsite and offsite optimization.

Onsite optimization means building and writing the website in such a way that the search engines as well as the human visitors find it appealing. This makes an enormous difference to the success of your website. I see sites every day that have been built without any understanding of SEO and are therefore not doing their job.

This is a specialized skill, and you have to expect to pay for it. Clients I work with have often spent thousands of dollars on their websites and still languish on the back pages of the search results. They have to compare the loss of business over the years with the cost of having their site done properly. If you’re planning a website, you can avoid the losses by having it done properly in the first place.

Offsite optimization means submitting your website to search engines and directories, engaging in social media, providing your site with rich content, and all the rest of the stuff I write about here.

You can do much of this yourself, if you have the time and the knowledge. With a good website, you should be busy enough not to have the time.

Prices for these services vary widely, too. There are companies offering SEO services of various kinds at various rates all over the web. The differences in prices and services are even greater than those for design. My advice, if you’re shopping around, is to study up enough on the subject (reading this blog is a good start) that you can tell what’s being offered to you and make a confident decision.

Conclusion

I hope this discussion has clarified some of the factors involved in pricing of websites. My advice is still the same: determine how much a new customer will bring to your business over the course of the year, and use that information to set your budget. Then you can figure out how to fit the website you need into your budget.